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Thursday, September 30, 2010

NewsJobless Claims Post DeclineInitial unemployment claims fell by 16,000 to 453,000 in the week ended Sept. 25, the Labor Department said in its weekly report Thursday. New claims for the previous week, ended Sept. 18, were revised upward to 469,000 from 465,000.In Tax Cut Plan, Debate Over the Definition of RichOne proposal being discussed is a millionaires’ tax, which would create one or two additional tax brackets for the wealthiest Americans and eliminate the Bush tax cuts only for those who earn more than seven-figure incomes.House passes tariff bill to stop China's yuan imbalance with U.S.Republicans from industrial states joined most Democrats in giving new powers to the Commerce Department to consider whether China's policy of tying the value of its currency to the dollar, rather than allowing it to rise in response to market forces, represents an unfair trade practice.European debt woes hit world marketsA new flare-up in Europe's debt crisis hit world stock markets Thursday after Ireland announced it would sink more billions into its failed banks and Spain's public debt rating was downgraded.Foreclosures Make Up 24% of Home SalesA total of 248,534 U.S. properties in some stage of foreclosure -- default, scheduled for auction or bank repossession -- sold to third parties in the second quarter. While this represents an increase of nearly 5% from the previous quarter, the figures are down 20% from the same time last year.US mortgage rates at record lows-Freddie MacInterest rates on U.S. 30-year fixed-rate mortgages, the most widely used loan, averaged 4.32 percent for the week ended Sept. 30, down from the previous week's 4.37 percent and matching a record low set earlier in the month, according to the survey.Oops! F.D.A. Error Is Talk of HenhouseMs. Balmer was in Pennsylvania to teach inspectors about how to keep germs away from poultry flocks, known as biosecurity. But the industry executives and state officials said she was breaking a basic biosecurity rule: keep vehicles, which may have driven through manure on rural roads or other farms, as far from the hens as possible.

BlogsThree Fed Officials, Three Divergent ViewsThree Federal Reserve officials are out today with divergent views on the economy and on whether the Fed should buy more Treasury bonds (which is known to some as quantitative easing) to push down long-term interest rates and stimulate growth.Fannie Mae and Freddie Mac: Serious Delinquent Rates declineFannie Mae reported today that the rate of serious delinquencies - at least 90 days behind - for conventional loans in its single-family guarantee business decreased to 4.82% in July, down from 4.99% in June - and up from 4.17% in July 2009.Secondary Sources: September Consumption, Basel III, Development ResearchA roundup of economic news from around the Web.CBO Says China Currency Bill Won’t Do MuchA little perspective may be helpful here. In 2009, U.S. imports of goods from China were $297 billion. So we’re talking about an average tariff rate change of 0.0017 percent. That’s expected to triple in fiscal 2013, to $15 million in revenue, perhaps 0.005 percent.Worried Consumers and CEOs Are Stuck in LogjamEarlier this week, the Conference Board’s consumer confidence index unexpectedly plunged to 48.5 in September, the lowest reading since February. On the heels of the consumer report came news from the Business Roundtable that its CEO economic outlook index fell to 86.0 in the third quarter, from 94.6 in the second.Recalculation vs. Structural Unemployment vs. AS/ADThe information technology workers laid off from financial firms may need different skills in order to be able to work on projects in nonfinancial businesses. They may need to start their own enterprises.City Unemployment: UnevenThe Labor Department’s report on metro area employment Wednesday showed jobless rates in August were lower in 182 of 372 metro areas surveyed, compared to a year ago. But the unemployment rate was up in 169 places and flat in 21. El Centro, Calif. and Yuma, Ariz., led the pack with the highest jobless rates at 30.4% and 30.2%, respectively.

Research, Reports & StudiesCompetition, Consumer Welfare and State Alcohol RegulationPrudent public policy seeks the right balance between the responsible consumer’s interest in low prices and availability and the potential social costs associated with underage drinking and irresponsible use of alcohol by adults. The Commerce Clause and the Granholm decision require just such a balance. Creating some form of a Commerce Clause exemption for state alcohol laws would disturb this balance and raise the risk that anticompetitive laws would be tailored to take advantage of such a refuge.Trade Freedom Continues to Advance—BarelyThe 10 countries with the highest percentage of people living in poverty have an average freedom score of only 70.3 in the 2011 Index. By contrast, the 31 countries with the lowest poverty levels have an average trade freedom score nearly 10 points higher, at 79.9. The lesson here is that reducing trade barriers reduces poverty.

Economists’ Comments & OpinionsOutsourcing and the 21st-Century EconomyTaxing new U.S. corporate investment at 35%, when the world average is just over 18%, pushes companies to invest offshore.The Only Policy Left: GrowthReducing spending, controlling entitlements, reforming public pensions—all of that matters. It's important. But any population being asked to "sacrifice" needs to be able to believe something better is possible.Why A Deficit-Financed Stimulus Leads Nowhere But To StagnationIn the business or entrepreneurial sector, rising productivity and an enhanced pace of technological innovation mean that the economic value of investing is higher. Consequently, by employing more resources today, greater consumption will be possible tomorrow.In Elizabeth Warren We Trust?The unaccountable head of the new Consumer Financial Protection Bureau has repeatedly used shoddy data to push policies she favors.Two Cheers for the New Bank Capital StandardsWhy do we still rely on the rating agencies, and why are we still allowing Lehman Brothers levels of leverage?

Book Excerpts"The wavelike movement affecting the economic system, the recurrence of periods of boom which are followed by periods of depression, is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion. There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." –Ludwig von Mises, Human Action (1949)

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This blog is a weekday economic buzz, news, opinions, blogs, research and data aggregated by the Joint Economic Committee, Republican staff. Disclaimer: The content posted here is provided for information uses only and should not be construed as the views of the Joint Economic Committee Republicans.